Why Is Iceland So Expensive?

If you’ve been looking into a vacation in Iceland or have friends who have traveled there, you probably know the price tag of such an adventure can be high. According to Numbeo, Iceland ranks as the second most expensive country in the world!

So, why is Iceland so expensive?

Supply and Demand: Tourism has been increasing, well more like exploding, the past number of years.

Remote Island in the North Atlantic: The growing season for food in Iceland is quite short, meaning the majority of food is imported (and taxed) and many other goods need to be imported (and taxed).

After reading all of this you may be tempted to bag the idea of an Icelandic vacation, but before you do, consider the following:

Your flight to Iceland from the US or Canada should be fairly inexpensive compared to most other international destinations. For example, a round-trip flight from New York to Reykjavik in August 2019 is currently $420, with flights from other Eastern/Central US cities close to that.

Along with being ranked one of the most expensive countries in the world, Iceland is also ranked as one of the most beautiful countries in the world. Obviously, this is subjective, but check out the hashtag #iceland for yourself.

You can sign up for a pre-paid tour where the majority of your expenses are paid for ahead of time, thus eliminating a lot of the sticker shock once you are there.

It’s good to know ahead of time how much to budget for your trip. Being realistic about what an Icelandic vacation will cost allows you to better plan how much money you’ll need to save up and what is worth spending your money on once you are there.